Small Business Commits to Social Media, Email, Search

About 75 percent of small businesses will increase their spending on email marketing in 2010, while nearly 70 percent will spend more on social media, according to VerticalResponse.

The findings might not suggest small businesses are spending wildly. In most cases the firms likely are testing new media. But the testing seems very widespread.

Almost all businesses with 500 or fewer employees will use email marketing next year, the company says. Only 3.8 percent of small business executives say they will not be using email marketing in 2010.

More than 70 percent also indicated they would not use TV or radio advertising.

Search advertising is used by about 72 percent of small businesses, but banner advertising is used by about 40 percent of small businesses, VerticalResponse says.

Facebook, Twitter and YouTube, as well as other social media sites, are used by about 78 percent of small businesses, the firm says.

Best Buy Sells Phone Power Nationwide

Best Buy now is distributing the "Phone Power" VoIP service nationwide. That's a pretty big boost for any retailer, and especially so for an independent VoIP provider aware that the market is consolidating and that scale is sorely needed.

Phone Power costs $19.95 per month with no contract, $16.95 with a one-year contract and $14.95 for a two-year contract. The service offers unlimited calling within the United States and Canada and 60 international minutes in 88 countries.

The Best Buy offering includes a two-line home adapter as well as a USB travel adapter. It sells for $79.95, and comes with a $79.95 instant service credit to be applied when the customer activates service on an eligible one or two year service plan.

It isn't clear yet whether Best Buy also will be actively selling Phone Power business packages, which come in both multi-line and single-line versions, offering unlimited inbound calling and 5,000 minutes of outbound calling with auto-attendant feature, and other popular business features, included on multi-line packages.

Apple And Android Dominate U.S. Smartphone Web Traffic

It is starting to look like just two smartphone platforms "matter" where it comes to use of the mobile Web: the Apple iPhone and the Android devices, a new analysis by AdMob suggests.

AdMob’s October, 2009 measurements show that the iPhone/iPod Touch and Android phones account for 75 percent of mobile Web traffic in the United States.

Apple devices continue to dominate, with 55 percent share, but Android users in October represented 20 percent of all activity, up from 17 percent in September, 2009.

The iPhone and iPod Touch grew their share from 48 percent to 55 percent share over the same period.

The Blackberry ’s mobile Web traffic share went down from 14 percent to 12 percent, and Palm’s webOS shrank from 10 percent to five percent.

On a global basis, the iPhone operating system now accounts for 50 percent of all mobile traffic, up from 43 percent the month before.

Android has an 11 percent global share, which makes it third globally after Nokia/Symbian’s 25 percent share.

Since Verizon launched the Droid about two weeks ago, Droids now make up 24 percent of all Android mobile Web traffic. The HTC Dream, which is the oldest Android device on the market, is the only Android device with more share, at 36 percent of Android traffic. Give it a few more weeks. The Droid is shaping up to be the most-popular Android device so far.

The data suggests that the BlackBerry, though a worthy enterprise device, continues to lag as a smartphone choice for users whose key applications lean to the Web.

Why Isn't All Voice Free?

"When I wrote a story about various VoIP initiatives a decade ago, nearly every expert I spoke to spouted the same prediction: within 10 years, all phone calls will be free," says John Dvorak, PC magazine columnist. "The rationale behind the pronouncement was that the wires and systems used for phone calls will eventually be used to transfer data, just like everything else."

"You don't get charged for visiting a Web page, so why get charged for making a phone call, if both are essentially data?" he muses.

It's an old argument, but is akin to asking why a diamond, made of carbon, is worth more than a thimble's worth of oil, also made of carbon, or a tiny cube of apple.

The answer to the question of different incremental pricing or costs to use network features has little to do with the representation of symbols and everything to do with larger permissible business models mandated by government entities.

In a legal and regulatory sense, bits are never "just bits." Cable TV bits are regulated differently from voice bits that touch the "public phone network," while Internet bits are regulated differently from each of those other types of bits and from private network data.

Still, it is one thing to argue that use of communications or other bits may not impose an incremental cost to a user. That is not to say there are not specific costs associated with use of the bits. Google Voice might not charge an end user for completing a specific call. But there are actual costs, imposed by the regulatory regime. Google pays them, not the end user.

But that does not mean the call has no cost, only that the cost is indirectly paid.

As for why others, besides Skype, other instantt messaging-based call providers, have not moved more aggressively to offer various forms of "no incremental cost to offer" calling, financial interests are involved as they always are.

One might as well ask why no-incremental cost education, music, video, books or plane tickets are not available.

In 1977, for example, long distance calling represented about half of all U.S. telephone company revenue. By 2007, that was no longer true. Instead, wireless services had taken the place long distance once played in underpinning the whole business. That isn't to say long distance has dropped to insignificance. It remains important. It is to say that there must be some revenue model underpinning the business, and if it is not long distance or voice, it will be something else.

No, there is no mystery about why VoIP has not lead, over the last 10 years, to "universally-free" (no incremental cost to end user)  voice calls. Voice, though declining, remains a key underpinning of the carrier business model. Nor do government regulators permit "free to end user" calling between networks.

Google Voice might not charge a U.S. user for a U.S.-terminated call. But Google Voice is compensating the terminating networks for use of their networks. Google Voice envisions a different business model for domestic calling than "per minute" use of the network. Lack of end user charges does not mean "terminating minutes" do not carry costs.

That, in fact, is behind Google Voice's blocking of some numbers, in some high-cost exchanges. And those charges are radically higher. Some firms report that the high-cost termination charges are as much as 25 times higher than typical.

Do We Need to Rethink What We Think We Know About Consumer Behavior?

Though 2010 widely is expected to provide a recovery from the depths of the recent recession, questions logically remain about how consumers will behave in a recovery most expect will be extended.

A new study by consumer research firm Decitica suggests lasting effects that could shape consumer spending on any number of communications services, applications and devices.

"The effects of the Great Recession on consumer behavior are so profound that many of the assumptions underpinning consumer segmentation are no longer valid," says Dr. Val Srinivas, Principal at Decitica.

Among the key findings: "Price has become the dominant consideration in the purchase of all kinds of products." For this reason, Decitica predicts "a long uphill struggle by marketers to shift the focus away from price."

The recession has caused a profound, deep-rooted change in consumers' spending habits in favor a more restrained approach, Decitica says. Many have accepted this radical change as the "new normal," and not just a cyclical phenomenon.

American consumers have proven researchers wrong in the past. The issue is whether this time might be different. See full post at http://blogs.metaswitch.com/gk/.

How Strong a Recovery; What Impact on Communications and Technology?

Since 70 percent of U.S. economic activity is generated by consumers, consumer behavior will be key to the arrival of a sustained period of growth. Conversely, anything that imperils consumer spending will weaken, choke off or abort any recovery.

In the past, this hasn't been an especially tough question to answer. Historically, recessions and recoveries roughly conformed to the principle of the bigger the bust, the bigger the boom, and vice versa. That, in turn, was underpinned by the underlying robust health of the U.S. economy.

Real growth in the four quarters following postwar recessions averaged 6.6 percent and 4.3 percent over the following five years.

Those figures are substantially above what economists seem to be calling for at the moment. The current recession has lasted a record seven quarters and has been marked by a near-record average gross domestic product decline of 1.8 percent per quarter.

All of that would, by historical standards, lead to a prediction of a powerful and sustained recovery. Yet forecasts of a two-percent recovery in growth are only one-fourth as strong as postwar experience suggests.

That suggests economists believe something has changed. We can argue about what the changes might be, and what is causing them. But this is not a political issue. As a simple matter of hope for America to get back to work, the anemic growth forecast is worrisome.

As someone who historically has tracked new technology and communications, as well as a citizen who wants the best for his country, it must be said: this does not bode well for our nation, our children or faster deployment of all sorts of interesting and useful tools people can use to enrich their lives and their work.

We might disagree from time to time about what should be done. That isn't the point. Clearly, something rather important is happening; something that defies historical precedent.

Perhaps the economists are wrong. They have been wrong in the past. I hope they are wrong about this. I continue to believe in the power of technology to make a huge difference in peoples' lives, and to fuel robust economic growth, which is, first and foremost, the way we are able to increase wealth and spread it around. I hope, for our nation's sake, that this continues to be true.

For that reason, I really hope the economists are dead wrong about the recovery rate. If not, we have some serious soul searching to do. Perhaps we have been dead wrong about some of our core beliefs.

"People Don't Like Ads" Yes and No

Surveys for decades have shown that "consumers don't like ads." But there's a big caveat. People always say they don't like ads when those ads are interruptions of some desired experience.

But sometimes ads are part of the desired experience. If you are an outdoors enthusiast, ads about gear you can use outdoors are very interesting. If you are a runner, ads about shoes, clothing, nutrition and events are very interesting.

If you are a surfer, ads about surfboards are very interesting.

So it comes as absolutely no surprise that 38 percent of respondents to a Parks Associates survey say they do not want to receive ads for any reaon. About 37 percent of respondents say they are neutral about ads and 25 percent are open to getting them.

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The study also confirms the notion that people will not mind getting ads when those messages are personally relevant, timely and valuable. To be sure, 18 percent of respondents say they don't mind seeing personally relevant ads, with 39 percent reporting they are indifferent and 43 percent not interested.

The problem with surveys, though, is that they sometimes cannot capture the complexity of consumer attitudes. Just about any survey will show that people dislike ads. But if asked whether they would rather pay money to gain access to desired content, for example, or get that same access for free, in exchange for the presence of ads, most people say they'll accept the ads.

Targeting and value make the difference. If the ads are relevant, they are unobjectionable, for the most part. If the user gets something in exchange for receipt of the ads, and the ads also are relevant, surveys show people are accepting, if not entirely happy all the time.